An up-and-down jobs report shows where action is needed for our post-COVID economy

A lot of grumbling happened after yesterday's US jobs report, where a bounce-back from August's "meh" was expected....and didn't happen.

The U.S. economy created jobs at a much slower-than-expected pace in September, a pessimistic sign about the state of the economy though the total was held back substantially by a sharp drop in government employment.

Nonfarm payrolls rose by just 194,000 in the month, compared with the Dow Jones estimate of 500,000, the Labor Department reported Friday. The unemployment rate fell to 4.8%, better than the expectation for 5.1% and the lowest since February 2020.

The headline number was hurt by a 123,000 decline in government payrolls, while private payrolls increased by 317,000....

“This is quite a deflating report,” said Nick Bunker, economic research director at job placement site Indeed. “This year has been one of false dawns for the labor market. Demand for workers is strong and millions of people want to return to work, but employment growth has yet to find its footing.”

The last two months have definitely seen flattening out after 4.5 million jobs were added in the first 7 months of 2021, and we still are well below the peak level of jobs that we had in February 2020.

But what jumps out at me isn't the lower-than-expected payrolls figure, it's the wide disparity among sectors in the US economy for September. Particularly the surprising number of areas that lost jobs in a month when the country was gaining nearly 200,000.

Let's start with the stat that should jump out at people, with schools in session by mid-September.

Local government education - 144,200

That number actually reflects lower-than-normal hiring for the school year, but it matches up with a lot of stories we saw in recent weeks about shortages of bus drivers and other school staff. It also indicates that a lot of people likely left teaching after 2020 or 2021, like my friend in Mauston who retired after 30+ years of teaching because she is immunocompromised and it just became too much.

In the private sector, the sectors that lost in September seems to be more adjustments to the 2021 version of COVID World.

Biggest private sector job losses, Sept 2021
Nursing and Residential Care Facilities -37,600
Food/Beverage Store -12,300
Auto Manufacturing -6,100

No surprise that people don't want seniors and others with high needs to be in nursing homes, and others don't want to work in such confined places. Seems like an alternative way to help these people would be a good idea.

Fortunately, the "big infrastructure" bill in Congress would do just that.

Translation for health care:

Reducing drug prices.
Extending extra ACA premium help.
Adding benefits to Medicare.
Filling the Medicaid coverage gap.
$ for home and community-based services, including wage hikes for caregivers. https://t.co/Mh7ssc9l0S

— Larry Levitt (@larry_levitt) October 4, 2021

And while anti-mask wackos get all the media, this was happening on Capitol Hill this week.

Thanks @SenBobCasey and @RepJayapal for visiting our 24hour vigil for home and community based services and understanding #CareCantWait pic.twitter.com/vy397jtsFl

— Colleen Flanagan (@ColleenFlangan) October 7, 2021

As for food/beverage stores, it appears that the growth that this sector had when COVID first broke out has now been unwound, as people move on to new jobs and more people are comfortable with eating/drinking. Interestingly, Big Box stores have not had a similar unwinding, which indicates that perhaps people are consolidating their trips into one place to buy these products.

And auto manufacturing is having an understandable cutback in a time when consumer spending has plummeted on autos, due tio higher prices, supply shortages, and a cutback after a buying binge in late 2020 and early 2021.

Interestingly, the rest of the manufacturing sector had strong gains in September, with 32,000 jobs added outside of the auto sector, and over 180,000 new jobs since April. Construction also had a nice (seasonally-adjusted) bounce-back after a weak Summer.

Think those sectors could gain even more if we put in programs for more roads and bridges? Yeah, me too.

We also saw some adjustments to COVID's resurgence in September. Bars and restaurants have only 4,300 more jobs than they had in July, and hotels and other accomodation services only added 2,100 in September. But delivery and warehouse jobs have started hiring again over the last 3 months.

So what the jobs report tells me is that our economy is still disrupted and likely permanently changed in some ways due to COVID-19, and we need to adjust our policies, resources and expectations accordingly. Doing nothing and letting these changes play out will leave an unacceptable number of people behind, and while GOPs may be fine with that (because it will help them in the 2022 elections), it would be awful for a country that has already taken far too many hits in the 2020s.